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SUSTAINABLE
AGRICULTURE
DEVELOPMENT Millennium Development Goal
ABSTRACT A detailed research project that aims to highlight the
judicious use of the available resources, integration
of factors of production, distribution and
consumption for development of a sustainable
agricultural model.
Ravi Soni I Sunil Patil I Nisha Chandra PGPMX 2018-20 Group Assignment
1
Disclaimer
This document does not claim that every theory and
model to be original. The findings, interpretation
and conclusion expressed herein are those of the
author(s) and do not necessarily reflect the views of
any individual, organization or institution.
The purpose of this note is purely academic and for
creating interest in the academic/intellectual
community for further research and innovation in
the area of Agriculture for sustainable development
of the sector.
Rights and Permission
The material in this publication is copyrighted.
Copying and/or transmitting portions or all of this
work without permission may be a violation of
applicable law. We encourage dissemination of our
work but will not grant permission to reproduce
portions of the work promptly.
Acknowledgements
This report has been prepared by
group of Students from IIM Indore
to identify the core concepts for
generation of models for sustainable
agricultural development programs,
policies and methodologies.
We thank Prof. Krishnan Natarajan
for his guidance, support and
encouragement for building up the
concepts and the contents of this
research paper.
We also thank the entire team of
librarians in IIM Indore for providing
us the research documents and
helping us zeroing the search
process for timely completion of the
report.
2
Contents Abbreviations .......................................................................................................................................... 3
FOREWORD ............................................................................................................................................. 4
INTRODUCTION ....................................................................................................................................... 6
Definition : Sustainable Agriculture Development ............................................................................. 7
Need for Sustainability in Agriculture ................................................................................................. 8
UN Sustainability Goals : Agenda 2030 ............................................................................................. 11
.......................................................................................................................................................... 11
.......................................................................................................................................................... 11
.......................................................................................................................................................... 11
.......................................................................................................................................................... 11
.......................................................................................................................................................... 11
Sustainability Standards & Protocols ................................................................................................ 12
IFC : Performance Standards on Environmental & Social Sustainability .......................................... 13
Agricultural Sustainability : Core Issues, Challenges and Concerns ...................................................... 14
Identification of core issues and concerns........................................................................................ 15
Issues and Challenges of Indian Agriculture Sector .......................................................................... 16
Agri Value Chain GAP Analysis : Present Scenario ............................................................................ 19
Solution Matrix : Sustainable Agriculture Development Model ........................................................... 22
Sustainability in Agriculture .............................................................................................................. 23
Agriculture Sector : Cultivation Matrix ............................................................................................. 26
Backward Integration & Forward Integration ................................................................................... 28
Factors of Production ........................................................................................................................ 29
Stakeholders ..................................................................................................................................... 29
Key Resources ................................................................................................................................... 31
Finance & Capital .............................................................................................................................. 31
Infrastructure .................................................................................................................................... 32
Knowledge & Technology ................................................................................................................. 33
Human Capital ................................................................................................................................... 35
Storage, Logistics Support ................................................................................................................. 35
Marketing & Sales : Demand Supply Analysis .................................................................................. 37
Strategies and Recommendations for Sustainability in the sector. ...................................................... 39
Bibliography .......................................................................................................................................... 42
3
Abbreviations
ADB Asian Development Bank
ASIAN Association of South East Asian Nations
ASS Agricultural Supply Chain
AU African Union
AVS Agricultural Value Chain
BLF Bought Leaf Factories
FPO Farmer Producers Organization
FTA Free Trade Agreement
GTA Global Trade Union
IFC International Financial Corporation
IFOAM International Federation of Organic Agriculture Movement
IK Indigenous Knowledge
IJSR International Journal on Science and Research
IPCC Intergovernmental panel on climate change
KP Kyoto Protocol
MDG Millennium Development Goals
OECD Organization for Economic Cooperation and Development
PS Performance Standard
SHG Self Help Group
SDG Sustainable Development Goals
UNFCCC United Nations Framework Convention on Climate Change
WB World Bank
4
FOREWORD
5
History dates back to almost ‘ten thousand years’ when mankind
first explored the concept of agriculture in the area called ‘Fertile
Crescent’ and today’s world of Iraq, Syria & Jordan. These areas
were at the confluence of continents of Africa, Asia and Europe
and thus became the epicentre where both civilizations and
agriculture began.
Thus the art and science of agriculture has not only evolved but
also sustained the vagaries and challenges of time. It has been a
witness of rise and fall of many civilizations, but still has been
continuum force that unites the boundaries and explores new
identity every time the tide of time tries to wipe it’s shore.
The modern age and time is facing unprecedented level of
resource constraint. The anarchic increase in population
supplemented with the age of consumerism and resource
overutilization has not only put an immense pressure on mankind
to explore methods to conserve the available resource but also
push the envelope to find ways wherein the resources can be
readily made available for the posterity.
Almost three years back World Bank adopted the 2030 Agenda
for sustainable development and the 17 Sustainable
Development Goals (SDG). This ambitious agenda faces daunting
and overlapping challenges such as climate change, conflict,
pandemics, political and environmental changes, shirking
resources and many others.
The present paper tires to find ways to overcome these
challenges and recommend a sustainable mechanism for
development of agriculture. The intent of the research work is to
find an innovative method to elevate poverty, overcome resource
constraint and integrate stakeholders - Farmers, Government,
Domestic and International Institutions of repute, NGOs ,
Corporations and Corporates, Industrial bodies and public in
general – for sustainability of agriculture in this dynamic world.
6
INTRODUCTION
7
Definition : Sustainable Agriculture Development
What is Sustainability & Sustainable Development ?
World Commission for Environment and Development (WECD)
has defined sustainable development as “ a process of change in
which the exploitation of resources, the direction of investment,
the orientation of technological development and institutional
changes are all in harmony and enhance both current and future
potential to meet human needs and aspirations”.
The five P’s of sustainable development as per UN Sustainable
Development Goal are described in the picture below:
(Source: https://c1.staticflickr.com/1/751/20545612759_d836116de4_b.jpg)
Core Elements of Sustainability
Environmental
Protection
Social
Development
Economic
Development
Sustainable Agriculture Development
8
Food is one of the most basic need for mankind’s survival and thus
despite the rise and fall of civilizations, the art and science of
agriculture has prospered over thousands of years.
As we grew and prospered, the exploitation of resources increased.
The over-exploitation of resources has not only constrained the
availability of most of the resources but also posed a serious threat
on development and prosperity of mankind in general. This chicken
and egg problem of need vs exploitation can be explained by the
underlying System Archetype Diagram :
Need for Sustainability in Agriculture
It is becoming clearer by the day that we need to reform our food
system. From droughts, to challenges in energy demand, to the
lack of transparency in our food choices, there are many reasons
why we need to change from a conventional industrial food
system to one that is sustainable.
Need for
Economic
Development &
Prosperity
Exploitation
of
Resources
Increase in need
for
Development/reso
urce creation
Resource
Become
Scarce
Resource become
unaffordable by
many
Need for creation of
more resources
increases
Resource are
affordable mostly
by affluent
Increase in social
conflict & tension
Leads of social
disparity and
inequality
Leads to
environmental
degradation
/natural
calamities/ global
warming
9
Following are the reasons why we need sustainable agriculture to
grow nutritious food for people, maintain the health of the planet,
and sustain livelihoods.
1. Sustainable farming restores and nourishes soil
Healthy soil leads to healthier plants and animals, resulting
in more nutritious food for people. Healthy soil holds in
moisture more efficiently than depleted soil does, and leads
to resilient healthy plants that are not susceptible to attacks
from diseases and pests.
Energy Conservation
Soil Nurishment
Nature Harmony
Bio Diversity
People I Planet I Profit
Economy
Climate Change
resilience
Water Conservation
Sustainable
Agriculture
Milton Friedman
10
2. Sustainable agriculture works in harmony with nature
Nature works through co-operation and collaboration
instead of domination. Thus sustainable farming should aim
towards developing harmony with nature and take future
generation into account.
3. Sustainable farms save energy
Sustainable agricultural practices tries to save energy use at
all level. The need of hour is to design farming system that
works smart and not hard, thus efficiency is the key for
sustainability.
4. Sustainable farming protects and conserves water
Employ methods that conserves water, include use of
mulching, drip irrigation, hügelkultur garden beds, create
swales on contour, recharge ground water, plant crop that
needs less water and focus on perennial crops with deep
roots.
5. Sustainable agriculture values diversity
Sustainable agricultural system incorporate crop
diversification leading to resilience to draught, disease and
pets. This also supports bio-diversity and ecological balance.
6. Sustainable agriculture provides resilience to climate change
It is cornerstone for low
input agriculture. This
implies energy efficiency
and reduction in green
house gases. This also leads
to water depletion and
draught prevention.
Sustainable Agriculture
11
7. Local sustainable farm support local community and economy
Reinvesting the cash generated in local economy has ripple
effect and supports building local community level economy
for sustainability and common prosperity.
8. Sustainable agriculture is good for people, the planet and is
profitable
A farming system is sustainable only if it benefits the people,
planet and is profitable perpetually to both.
UN Sustainability Goals : Agenda 2030
The sustainable Development Goals are the blueprint to
achieve a better and more sustainable future for all. The UN’s
17 goals to be achieved by 2030 for sustainable development
include :
1. No Poverty
2. Zero Hunger
3. Good Health
4. Quality Education
5. Gender Equality
6. Clean water & Sanitation
9. Affordable & Clean Energy
10. Decent work & Economic Growth
12. Industry, innovation, infrastructure
7. Reduced inequalities
8. Responsible Production & Consumption
11. Climate Action
13. Life below water
14. Life on land
15. Sustainable Cities and
Communities
16. Peace, Justice and Strong
Institutions
17. Partnerships
12
Sustainability Standards & Protocols
Sustainability Standards and certifications are usually
voluntary and third party assessed, norms and
standards relating to environment standards such as
IFCICT Standards. Most of these standards refer to
triple bottom line of environmental quality, social
equality and economic prosperity.
The ISEAL Alliance has emerged as an authority on
good practice on sustainability standards and its codes
of Good Practice represent the most widely recognized
guidance on how standard should be set and
implemented.
Some of the globally recognized sustainability
standards include :
➢ Fairtrade : Adopted environmental objectives as
part of their certification system. Guarantees Minimum
price & social premium that goes to the co-operatives
and not the producers.
➢ Rainforest Alliance : Committed to conserving
rainforest and biodiversity. Key element of this
standard is the compulsory elaboration and
implementation of a detailed plan for development of
sustainable farm management.
➢ UTZ Certification : It aims to create an open and
transparent marketplace for socially and
environmentally responsible agricultural products.
➢ Organic : It is based on IFOAM Basic Standard and is
leading umbrella organization for organic farming.
➢ trustea : This code is designed to evaluate the social,
economic, agronomic and environmental performance
of Indian Tea Estates and Bought Leaf Factories ( BLFs)
SHRINK WRAPPING: AN INNOVATIVE TECHNOLOGY FOR ENHANCING SHELF LIFE AND QUALITY OF POMEGRANATE
Wrapping of fruits with a
heat-shrinkable film (29µm
thickness) followed by
storage at ambient
conditions, (18-30oC, 55-
60% RH) for 60 days
influence the quality of
fruits. Control fruits were
found deteriorate at a very
high rate, in their physical
appearance as well as
nutrition quality. Wrapped
fruits showed minor changes
in nutritional value in
respect of total phenols,
anthocyanins and
antioxidant activity during
60 days at ambient
conditions, whereas non-
wrapped fruits deteriorated
earlier at similar storage
conditions.
Source : Research report by
V.R. SAGAR, R.R. SHARMA
AND KULDEEP KUMAR
http://www.sustainableagric
ulture.in
13
IFC : Performance Standards on Environmental & Social
Sustainability
IFCs sustainability framework articulates the Corporation’s strategic
commitment to sustainable development. The performance
standards have basic objective of mitigating the risk on account of
overexploitation of resources.
The eight performance standards established by IFC include :
1. Performance Standard 1 : Assessment and Management of
Environmental and Social Risk and Impacts
2. Performance Standard 2 : Labour and working condition
3. Performance Standard 3 : Resource Efficiency and pollution
Prevention
4. Performance Standard 4 : Community Health, Safety and
Security
5. Performance Standard 5 : Land Acquisition and Involuntary
Settlement
6. Performance Standard 6 : Bio-Diversity Conservation and
Sustainability Management of Living Natural Resources
7. Performance Standard 7: Indigenous People
8. Performance Standard 8 : Cultural Heritage
Adherence to these basic performance standards in agriculture
would lead to attaining slated UN Sustainable Development Goals.
“We are moving urgently to
help countries to increase
sources of renewable
energy, decrease high
carbon energy sources,
develop green transport
system, and build
sustainable, liveable cities
for growing urban
population.“
World Bank Group
14
Agricultural Sustainability :
Core Issues, Challenges and
Concerns
15
Identification of core issues and concerns
The three basic challenges faced by agriculture include feeding
the growing population, providing livelihood to farmers and
Protecting the environment.
By 2050 world will have 10 billion mouths to feed.
As the population and income grow, so will the demand for
meat, fish, dairy and farm related agricultural products will
grow.
The growing population and urbanization has limited the
availability of agrarian land.
Climate change, draughts and floods, changing rainfall
patterns are key factors which may hinder growing
demand
As per a report UN’s intergovernmental
panel on climate change (IPCC) climate change
itself is cutting into the global food supply affecting
global wheat and maize supply
Fish are also taking a hit due to sudden and abrupt climate
change and global warming
The over exploitation of land has resulted into reduced
productivity of agricultural land. This is further getting
augmented by soil erosion, soil salination, water
contamination and deforestation.
“ To make agriculture
sustainable, the grower has
got to be made profitable.”
Sam Farr
16
The vicious cycle has resulted into ripple effect of crimping
the available resource furthering human suffering and social
tensions.
Issues and Challenges of Indian Agriculture Sector
A typical farmer in India faces challenges mainly in three areas
A. Input Gaps : Inefficient backward integration of resource,
knowledge, planning and execution.
Resource Constraints
❖ Shrinking / fragmented land due to land distribution
❖ Financial and monetary constraint before sowing season
❖ Unavailability or cost of standard quality seeds &
fertilizers
❖ Limited livestock’s organic manures
❖ Lack of modern farm implements and technological
inputs
❖ Lack of talented and skilled workforce (very limited
Engineers, Management school students or agricultural
university student take up direct farming as profession)
Knowledge Gaps
❖ Lack of skills for modern
and innovative farm practices
❖ Limited knowledge about
incumbent rain, flood, draught
or hails.
❖ Lack of understanding and
skills related to modern
methods of irrigation,
cultivation and plantation.
❖ Indian farmers are not integrated to global farmers who
have started using latest technology for farm
productivity and efficiency
“THE FARMER IS THE ONLY MAN
IN OUR ECONOMY WHO BUYS
EVERYTHING AT RETAIL, SELLS
EVERYTHING AT WHOLESALE,
AND PAYS THE FRIGHT BOTH
WAYS”
John F. Kennedy
17
❖ Limited knowledge of soil composition, water and
mineral content and matching crops suiting soil, climate
and minerals.
Planning and Execution Gap
❖ Lack of skills to manage the finance/budgets, technology
and advanced knowledge
❖ Limited know how about various factor of production,
storage and distribution. This leads to asymmetry of
information.
❖ Disintegrated with techniques of farm analytics and
strategic planning for cropping pattern, climatic
prediction.
❖ Disintegrated farming leads to limited understanding
about demand supply gap. This leads to similar cropping
and over production, thus leading to low revenue per
unit of production.
B. Processing / Production Gaps : Inefficient production
techniques
❖ Farm productivity is
relatively low vis a vis global
standards on account of low
level of technology, unskilled
workforce and poor quality of
seeds and other inputs.
❖ Outdated techniques are
still being applied by a
majority of the farming community, thus leading to low
farm output.
C. Output Gap : Forward integration shortcoming
Poor quality of post harvesting Technique
❖ Indian farmers still use primitive or outdated post
harvesting techniques due to which there are lots of
pilferage and wastage.
Agricultural Value Chain
Gap Analysis
1. Backward
Integration Gaps
(Input Gap)
2. Production or
Processing Gap
3. Forward Integration
Gap ( Output and
Distribution Gap)
18
❖ Lack of farm mechanization during post-harvest
seasons leads to increase in total production cost.
❖ With the increase in labour prices, the financial
burden has further aggravated.
Post-Harvest Storage & Financial Gap
❖ Lack of proper infrastructure such as non-availability
of quality cold storage at affordable price for
perishable goods.
❖ Lack of quality storage facilities for other food grains
❖ Due to lack of proper storage facilities, the farmers
are forced to sell their products immediately post-
harvest at cheap price.
❖ Due to financial constraint and long production
cycle of Agri-products, farmers realize the net proceeds
of production immediately post-harvest.
Post-Harvest Logistics and Transportation Gap
❖ Sub-Standard basic transport infrastructure such as
poor quality roads in rural & sub urban areas leads to
increase in transportation cost and wastage due to
accidents.
❖ Unorganized logistics and transport facilities lead to
pilferages and cost appreciation for farmers.
❖ Logistics is one of the most week links in Agri supply
chain. Farm to market integrated facilities are missing.
❖ Due to unorganized farming sector as well as
distribution network, the bargaining powers are
dynamic and asymmetric.
❖ Transportation infrastructure such as linkages
between Road, Rail and Waterways are not integrated
and well structured.
PRE-POST HARVEST LOSS
Crop Loss : Difference
between potential yield and
actual yield.
Pre-Harvest Loss :
According to research report
of Dr.Elumalai Kannan the
crop loss estimates due to
insect pets are estimated to
be 25% in rice and maize, 5%
in wheat, 15% in pulses and
50% in cotton. The crop loss
has increased post green
revolution.
Post-Harvest Loss
According to World Bank
(1999) stud, Post-Harvest
losses of food grain in India
are 7-10% of the total
production from farm to
market level and 4-5% at
market and distribution
level.
Dr.Elumalai Kannan in his
research report states that
“ With the given per capita
cereal consumption in India,
post-harvest loss would be
sufficient to feed 10 crore
people.”
19
Agri Value Chain GAP Analysis : Present Scenario
Based on the assessment of constraints at various levels being faced
by the Agriculture sector, we have tried to draw the schematic and
mathematical model to understand the GAPs in present value chain
structure of Agriculture in India.
The value
chain
matrix
has been
contextualized to
define present gaps in the system and find a logical solution for
development of a sustainable model that can be adopted in future.
The total profit generated in the Agri-Value chain is a function of all
the nine variables as shown in Figure A.
Converting the diagram into a mathematical model the net profit
generated in Agri-Value Chain is slated as under :
𝜋 = ∑ 𝜆𝑖𝐻𝑅𝑖=𝑛
𝑖=1+ ∑ 𝜆𝑖𝑃
𝑖=𝑛
𝑖=1+ ∑ 𝜆𝑖𝑇
𝑖=𝑛
𝑖=1+ ∑ 𝜆𝑖𝐼𝐿
𝑖=𝑛
𝑖=1+ ∑ 𝜆𝑖𝑂
𝑖=𝑛
𝑖=1+ ∑ 𝜆𝑖𝑂𝐿
𝑖=𝑛
𝑖=1+ ∑ 𝜆𝑖𝑀&𝑆
𝑖=𝑛
𝑖=1+ ∑ 𝜆𝑖𝑆
𝑖=𝑛
𝑖=1+ 𝜉
Infrastructure
π
Human Resource Management
gement
Sup
po
rt A
ctiv
itie
s
Technology Development
Procurement
Inb
ou
nd
Lo
gist
ics
Op
erat
ion
s
Ou
tbo
un
d L
ogi
stic
s
Mar
keti
ng
& S
ales
Serv
ices
Primary Activities
Figure A
Equation - I
ξ is the external Variable (uncertainty ) and is a joint function
of all the variables of Primary & Support Activities
λi are the direction or incidence of respected variables
HR, P, T, IL, O, OL, M&S, S are magnitude of Support & Primary
Activities in Agri-Value Chain
20
In order to understand the impact of any single variable to intraplate
its interpretation on profit, let us keep HR as single variable and
other variables as constant. Partially differentiating the equation I
w.r.t HR
𝜕𝜋
𝜕𝐻𝑅= ∑𝜆𝑖 𝑓′(𝐻𝑅)𝑅 + 𝜉′
The equation can be interpreted as follows :
• Given everything other as constant, the profitability of
Agricultural system is a function of quantity of human
resource supplied along with the direction of labour and
some external factors. Direction of labour is synonym of
quality of skilled man power.
• The effectiveness level of farm output can thus be increased
even if the number of labour force is reduced but skill
development and knowledge augmentation in manpower is
enhanced.
Similar interpretation can be derived for all other variables of the
value chain. In the present Agri-
Value chain the over-all profitability
of Agriculture is abysmally low as
there age wide gaps in all the
segments of Value chain and overall
efficiency is getting dampened. This
has resulted into low level of activity
in the sector, low investment and
below normal enthusiasm by
entrepreneurs to venture to become a full-fledged farmer.
The sustainability of agriculture in India at the present level of
activity and interest are thus a serious concern.
Source : Govt. of India, Nity Aayog
21
As per Nity Aayog GOI, the total mark-up value of any farm product
is approximately 60-70% of its original production cost. The margin
gained by the farmer in this total process are less than 10%. The rest
50-65% are transactional cost gained by various intermediaries in
the supply chain of Agri-goods.
The Agri-Sector is grossly unorganized due to which there are
sufficient information asymmetry. There exists arbitrage
opportunities due to lack of awareness, vast geographical
boundaries and inefficient supply chain network. The intermediary
and transactional cost are thus as high as 50-60% of the actual value
of the product.
This is the core challenge for sustainability in the sector.
22
Solution Matrix :
Sustainable
Agriculture
Development Model
23
Sustainability in Agriculture
In order to determine a Sustainable Agriculture Development
model, we have tried to plot the matrix on three bord
parameters :
1. Economies of Scale
2. Economies of Scope
3. Economies of Knowledge
Economies of Scale
The basic reason why agriculture has become unviable and
economically unsustainable is that the sector is widely
unorganized and fragmented. Thus there are millions of farmers
producing in a fragmented land and with
primitive or near to primitive technology.
The economies of scale which are
function of six broad factors viz.
Bulk Production or Procurement
( realizing profit from buyers bargaining
power)
Efficient Production ( by
integration of skill, knowledge and technology supported
by prudent financial system)
Reduction in production cost, Reduction in Logistical &
Distribution Cost
Cheap Capital and
Spread of Risk
The economies in scale in Agriculture is one of the necessary
condition for its sustainability. This can be achieved through
1. Institutionalization and corporatization of Agriculture
Sector
24
2. Bringing in land consolidation reforms and legislations.
Land Pooling and reformed ownership structure
3. Change in land ownership structure, land inheritance
norms and structures
4. Organizing the Agri-
Sector into large co-operative
or Corporate structure with
innovative ownership norms.
This can lead to reduced
exploitation
5. Integration of latest
technology in every aspect of
Agri-Value chain.
6. Backward and Forward
integration of activities &
channelization of information
to reduce transaction and intermediator cost.
7. Farm Digitization and Farm Mechanization
8. Use latest technologies of production, distribution,
storage, marketing and sales.
9. Planning and Policy making should be aligned for long
term sustainability in the sector and achieving economies
of scale to make the sector more profitable and viable.
10. Reduce Dis-economies of scale by adopting principles of
diversification and knowledge.
Effects of Economies of Scale on Production Cost
a. It reduces the per unit fixed cost. As a result of increased
production, the fixed cost gets spread over increased output.
b. It reduces per unit variable cost. This occurs as the expanded
scale of production increases the efficiency of production
process.
Efficiency in Economies of Scale
Economies
of Scale
Dis-
Economie
s of Scale
25
Economies of Scope
All the tools of analysis in general economics are employed in
agricultural economics as well. Scope and diversification can be
explored in the filed of :
1. Agronomics
2. Crop Diversification, Cash Crop, Floriculture, Forti culture
3. Nutritional crop cultivation such as bulk Moringa Cultivation
4. Crop Simulation and iteration for futuristic predictive analysis
of market and demand vis a vis future supply
5. Vertical Urban Agriculture
6. Aquaculture & hydroponics
7. Animal Husbandry
8. Sericulture
9. Fish & Shrimp Cultivation
10. Agriculture economies in Applied Science, Digital integration,
Artificial Intelligence, Space Technology etc.
Economies of Knowledge
In order to build a sustainable Agriculture Development Model,
the economies of knowledge is most vital and key element apart
from economies of scale and scope.
The tirade of population explosion, livelihood for all and
environmental protection are vital for Agri-Sustainability. In order
to achieve the slated objectives, creating synergies (Positive
Effect) or Trade-offs (negative effects) with respect to other
objectives- and a single use perspective on any objective can lead
to unintended impacts on other objectives. Competing objectives
and complex interactions, along with multiple stakeholders with a
range of concerns, should make us cautious with specific ideas
and lead to higher prices to consumers.
The economies of knowledge encompasses the following domains
26
➢ Integration of Planning, Policies and Stakeholders
➢ Integration of Skill, Knowledge and Technology
➢ Integration of Finance, marketing, and operations
The new age Digital Revolution can help make a sustainable agri
value chain.
Agriculture Sector : Cultivation Matrix
The granular recommendation for development of a sustainable
agriculture model starts with identification of current cultivation
methodologies and deriving at a matrix for recommending
futuristic cultivation methods.
27
While the current cultivation methodologies have been explained
in the earlier sections, we will focus on developing a new
cultivation matrix for sustainable growth:
This the production efficiency is a function of judicious utilization of
resource in time horizon. This can be achieved by a multiple factor
analysis such as :
1. Soil Testing & sowing as per nutritional value of soil
2. Seed nourishment and deworming before cultivation
3. Prior knowledge of climatic change, weather forecast and
monsoon forecast
4. Water conservation and integration of modern irrigation
technology for productivity improvement
5. Collective cultivation, land pooling etc to get more bargaining
power from seed, fertilizer suppliers.
Hig
h
Med
ium
Lo
w
Low Medium High
Moderator
Identify the gaps and areas of over
exploitation of resource. Stakeholder,
internal & External analysis needed.
Translator
This needs little focus and resource use
optimization to become Transformers.
Navigators
They are the navigators who
understand and utilize resource
judiciously but need additional
support.
Transformers
Build upon the success stories and
replica of model for imitation and
scaling. Communicate Effectiveness
Sailors
Successful methods applied, need
additional external support to become
transformers
Externalities
Identify external variables that
impedes productivity and reduce their
effectiveness
Commonalities
Identify common areas of mistakes,
influence institutions and policy
makers
Changers
Require strategic initiatives to reduce
resource over utilization and improve
productivity
Danger
Urgent Change Required : Adopt
Technology, People, Planning and
Knowledge to reduce over utilization
of Resource and increase productivity
Sustainable Cultivation Matrix
Judicious Use of Available Resources
Pro
du
ctiv
ity
Incr
ease
28
Backward Integration & Forward Integration
Backward integration is the holistic approach
driven towards Pre-Cultivation methodologies. The
pre cultivation value chain include
i. Knowledge and Pricing of Seeds
ii. Tie-up with financial institution/ banks for timely
supply of cash
iii. Know how of climate, weather forecasting
technique.
iv. Assessment of need of the market, post-harvest
estimation and price sensitivity analysis
v. Choosing the crop as per sensitivity analysis and
budget, market information, neighbouring
cultivation pattern, Govt. or institutional minimum
support price etc.
vi. Farm Mechanization, Farm Digitization, AI
application and technological intervention for
process reengineering
vii. Rainwater harvesting techniques, Irrigation
facilities, wate
conservation and storage
facilities, modern irrigation
methodologies
viii. Pest control methods,
organic cultivation, Neem
etc Plantation in the
vicinity
ix. Soil nourishment
through organic methods,
use of vermi-compost
x. Rearing of cattle and livestock for additional
income, use of dungs as manures
“BOWED BY THE WEIGHT OF
CENTURIES HE LEANS UPON HIS
HOE ON THE GROUND, THE
EMPTINESS OF AGES IN HIS
FACE,AND ON HIS BACK THE
BURDEN OF THE WORLD”
Edwin Markham
ETHYLENE SYNTHESIS INHIBITORS AS TECHNIQUE FOR INCREASING SHELF LIFE AND QUALITY OF FRUITS AND VEGETABLES
Ripening is nowadays not
only a physiological process
but it is becoming a tool for
farmer to manage and sell
their produce at a proper
stage and quality of the fruit.
Physiologically it is defined
as the process by which
fruits attain their desirable
flavour, colour, palatable
nature and other textural
properties which ultimately
make it more attractive and
edible. Ripening is not only
associated with the change
in internal composition i.e.
sugar, TSS, acids, but also
external appearance like
colour, flavour, texture.
Thus, ripening is the process
which affect horticulture
commodity from the point of
view of farmer, wholesaler,
trader and consumer.
Ethylene biosynthesis
inhibition for enhancing
shelf life
Source :
http://www.sustainableagric
ulture.in
29
xi. Modern and Integrated Transportation and Logistics
xii. Market Information, Demand Supply knowledge and
analytical insights post-harvest
xiii. Integrated supply chain, storage facilities, warehousing
facilities
xiv. Prevention of pilferage, wastage and distribution loss
xv. Money supply, credit facilities and integration of prices
with market both spot and futures
xvi. Digital integration of agri-supply and value chain.
Factors of Production
The various factors of production that are integral to development
of Sustainable Agri-Value Chain include :
✓ Consolidation of land and methods of land pooling
✓ Upskilling of work force and reduction in disguised
employment. Workforce resource optimum utilization.
✓ Adequate and timely support of capital, channels of Agri
finance
✓ Return on investment analysis
✓ Technology updates and latest R & D initiatives integration
✓ Formation of SHGs, channels of Government support and
utilization of Government led Agri Schemes
Stakeholders
The various Stakeholders in Agri-Value Chain Development include
➢ Farmers
➢ Government & Semi Government Authorities
➢ Traders & Merchants of Agri goods
➢ Pesticide and Fertilizer Producers
➢ Seed Manufactures and distributors
➢ Transport and Logistical support partners
ENHANCING CROP
PRODUCTION BY ENHANCING
WATER EFFICIENCY
Agriculture is the predominant user (75-
80%) of the available fresh water
resources in many parts of the world. As
water resources shrinks and competition
from other sectors grows, agriculture
faces dual
challenges: to produce more food with
less water and to prevent the
deterioration of water quality through
contamination with soil runoff, nutrients
and agrochemicals. Water use efficiency
by crops can be enhanced by selection of
crop, variety, Agronomic practices like
time of sowing, method of
sowing/planting, seed rate, plant
population, interculture, fertilizer and
irrigation, intercropping should be
evaluated with the irrigation levels for
high water use efficiency and economic
yield of crop.
Optimum time of sowing/planting, seed
rate, plant population, interculture,
herbicide application, fertilizer facilitate
better growth and development which
resulted in higher crop yield and water
use efficiency. Conservation tillage
practices like zero tillage; reduced
tillage/minimum tillage utilizes more
judiciously the plant available water than
the conventional tillage when the other
factors are similar.
Source : Agriculture for sustainable
Development 5(1) :11-117, 2017/Article
30
➢ Consumers
➢ Muti-Model Retailers and wholesalers
➢ E-trading platform, e-traders and mega retailers
➢ Banks, Financial Institutions and Money Lenders
➢ NGOs, SHGs, UN Bodies, World Bank, IFCs etc.
Collective understanding among all the stakeholders for
sustainability is most important for a efficient model to
work. The planning, execution, policy driving initiative
and directional support are provided by Govt. and its
agencies.
UN bodies, World Bank and IFC provide a holistic vision
and strategic alternative to key challenges.
Reducing the role of intermediaries and overall
transaction cost so that the net benefits of value derived
are shared by the original producers.
AGROECOLOGY AND 2030
AGENDA Agroecological approaches address
root cause of hunger, poverty and
inequality, helping to transform
food system and build resilient
livelihoods through a holistic,
integrated way that balances the
three dimensions of sustainability –
social, economic and environmental
– ensuring no one is left behind.
Ten elements of Agroecology
include :
1. Diversity
2. Co-creation and sharing of
knowledge
3. Synergies
4. Efficiency
5. Recycling
6. Resilience
7. Human and social values
8. Culture and food tradition
9. Responsible Governance
10. Circular and solidarity
economy
Methods
1. Scaling up through farmer
field schools
2. Marketing the nutritional
goodness of purple and
pink rice from the
mountains of India
3. Ecosystem Service and bio-
diversity
4. Access fuel for cooking
Source : www.fao.org.
31
Key Resources
The resources required for sustainable supply chain in
agriculture include :
1. Skilled Workforce
2. Indigenous Knowledge
3. Land & Capital
4. Infrastructure
5. Technology
6. Water, Energy & Bio-Diversity
7. Producers, Suppliers, Market, Wholesalers, retailers, Govt.
Institutions etc.
In order to build a sustainable supply chain model in agriculture
an integration of key resources, and all other stakeholders are
pre-requisite condition.
Finance & Capital
The sector is unorganized in India, as such faced multiple layers
of capital constraint. The easiest way to secure funding by small
and marginalized farmers are through money lenders. This
channel has exorbitant rate of interest (sometimes as high as
60% annually).
Apart from this there are other models of SHGs, MFIs, Private
lenders, banks as well as grant from Govt. Institutions. The lack
of awareness and trust has impended the channel of safe,
secured and easy access of credit flow for millions of farmers.
The sector needs to be organized so as to get easy and
affordable supply of credit flow on time. The following
mechanism can be explored to fund long and short term credit
to farmers at affordable rates :
The importance of bee and other
pollinations for food and agriculture.
Improving pollinator density and
diversity boosts crop yields –
pollinators affect 35 percent of
global agricultural land, supporting
the production of 87 of the leading
food crops worldwide.
Pollinator-dependent food products
contribute to healthy diets and
nutrition.
Pollinators are under threat –
sustainable agriculture can reduce
risk to pollinators by helping to
diversify the agricultural landscape
and making use of ecological
processes as part of food production.
Safeguarding bees safeguards
biodiversity: the vast majority of
pollinators are wild, including over
20 000 species of bees
Source : Food and Agriculture
Organization United Nations
Why Bee Matter
32
1. Floatation of Agri-Sovereign Bonds with different maturity
tenors.
2. Credit monitoring and discipline of farmers to reduce Probability
of default
3. Database of credit monitoring and disbursements so as to create
a credit profile (rating) of each individual borrower.
4. Institutionalization of Agriculture as co-operatives, corporates.
The farmers can pool their lands, crate co-operative cultivation
techniques, common marketing and sales platform, better
knowledge of market, dynamics and technology.
The capital cost of machineries and latest technologies are very
high. Collective cultivation or corporatization can increase their
ability to invest in long term capital assets.
Corporatization can lead to better information flow, thus increase
their bargaining power, technological integration and access to
market. The storage techniques can be further improved. The
farmers need not sell their products just after production but can
store in warehouses and get fiancé through warehouse receipts.
Infrastructure
Infrastructure and capacity building are essential elements for
creating a sustainable agriculture development model. The basic
infrastructural facilities needed for sustainability and scalability
include :
1. Basic infrastructure of irrigation, water storage and water
harvesting techniques.
2. Renewable source of power
3. Last mile connectivity through better rail, road, water and air
4. Internet access to last doorstep
5. Mobile network
6. Transportation facilities both local and long distance
33
7. Safe Storage and cold storage facilities
8. Distribution network, market access and export
hubs
9. Social Media, Digital Media and other new age
marketing infrastructure
Knowledge & Technology
Latest technological inputs in every domain of value chain
of agriculture can lead to environmentally sustainable
agriculture development model.
Some of the latest technological interventions include :
1. Digital Technologies in agriculture and rural areas
The research paper of Nikola M Trendov, Samuel Varas
and Meng Zeng published Food and Agriculture
Organization of United Nations states importance of
Digitalization for development of sustainable agriculture.
The paper illustrates about the digital agricultural
revolution and conditions for digital transformation. Nikola
states in the paper
“ Market forecasts for the next decade suggest a ‘digital
agricultural revolution’ will be the newest shift which
could help ensure agriculture meets the needs of the
global population into the future.”
They further enumerate the various conditions for digital
transformation as under:
➢ Basic conditions are the minimum conditions required
to use technology and include: availability, connectivity,
affordability, ICT in education and supportive policies
and programmes (e-government) for digital strategies
➢ Enabling conditions (‘enablers’) are factors that further
facilitate the adoption of technologies: use of internet,
SMART FARMING IS KEY TO AGRICULTURAL DEVELOPMENT
Agriculture is undergoing a
fourth revolution triggered
by the exponentially
increasing use of
Information and
Communication Technology
(ICT) in agriculture.
Autonomous robotic
vehicles have been
developed for farming.
Smart farming reduces
ecological footprint of
farming. This can make
agriculture more profitable
and boost consumer
acceptance.
34
mobile phones and social media, digital skills and
support for agripreneurial and innovation culture (talent
development, sprint programmes including hackathons,
incubators and accelerator programmes).
2. in Agriculture and its role in Sustainable Development
Dr.Tarq K.Hassan and Haidi jamal Abdullah in their research
report published in International Journal on Science and
Research (IJSR) mentions the key elements of IK as under:
➢ IK is local based knowledge instead of knowledge that is
used across a wide range.
➢ It is experiential in terms of being based on what people
have perceived in their surrounding and what is passed
on through generations
➢ It is very socially constructed
➢ It is learned via being apprenticed to local experts
➢ It is pragmatic rather than theoretical
➢ It is generally orally perceived rather than written
document
The indigenous knowledge can be key to solving many challenging
and ecologically damaging issues surrounding the world of
Agriculture. Preservation of this knowledge and its dissemination to
new generation are essential for development of a sustainable
supply chain in Agriculture.
3. Use of Robotics, AI and ML for Agri-sustainability and
development. Smart farming techniques need to be adopted.
4. Use of ICT in augmenting the supply chain network and reducing
the transaction cost.
5. Analytical tools to be applied to forecast demand and risk
associated with cultivation, storage and distribution.
6. Modern management science in supply chain and logistical
innovation should be applied.
35
Human Capital
Majority of the agricultural sector is driven by semi-skilled or
unskilled labour force. Since agriculture sector has remained grossly
unprofitable, most of the qualified talent pool do no prefer to enter
the sector.
The Agricultural sector and its entire value chain demands new
generation technological and managerial skill sets. In order to be
sustainable, corporatization of agriculture is a must. Thus most
talented entrepreneurial mindsets needs to be drawn into
the sector.
Storage, Logistics Support
One of the key challenge for agriculture supply chain is lack
of proper storage, logistics and marketing /sales support for
the farmers.
Storage :
Some of the recommendations that can help reduce pilferages and
losses both during pre-harvest and post-harvest seasons include:
1. Formation of community based co-operative storage facilities
with joint ownership of farmers, communities, government/
semi government institutions as well as corporates and
industrial bodies.
2. Digitalization of each storage / warehouse with technology to
measure weight, moisture content, nutritional values. The
technology to detect pests, infections and worms or bacteria
can be detected on real time basis. This can help reduce the
wastage.
3. Modulating the storage facilities in Hub-and-Spoke model with
near access to major producing centres and easy access to
transportation facilities. This would lead to lower cost of
logistics and greater reach of farm to market.
Types of Storage
➢ Underground
Storage Structure
➢ Surface Storage
Structure
➢ Improved Grain
Storage Structure
➢ Warehousing
Some of the major
Warehousing in India include
i. Central Warehousing
Corporation
ii. State Warehousing
corporations
iii. Food Corporation of
India
36
4. Cold Storages for perishable items such as fruits and vegetables
with facilities to top solar power.
5. These storage facilities can augment farmers with information
regarding demand and supply. Thus improve their cash flow and
income levels.
Logistics
Approximately 5-10% pilferages and losses in Agri-goods happen
due to shabby logistical support. This includes overloading of
tractors, lorries and trucks leading to accidents and loss. Lead time
for transportation are high due to lack of basic infrastructure form
farm to market. Poor quality of rural roads, lack of dedicated rail
lines, poor docking and redocking facilities on rail yards,
transportation network not adequately connected to ports and
export oriented units, corruption on roads due to which cost of
transportation is high.
Due to these bottlenecks, the logistical cost are not only high but
also flow of information and real time tracking of goods and services
are not adequate.
Some of basic solutions suggested include:
✓ Community based or e-portal / commerce based local
transportation for farmers. Ideas like Ola and Uber can be
extrapolated for farmers during crop seasons. This will
reduce transportation search cost and search time.
✓ Excess loading should be checked and heavy penalty
imposed for violation. This can help reduce loss due to
accidents.
✓ Block level connectivity of roads and rails
✓ Tracking of movement of goods through digital channel and
immediate docking of lorry transported goods to rail
wagons. This can help reduce the lead time for transport
from farm to market.
37
✓ E-lorry receipts and e-way bills for real time and online
tracking of goods
Marketing & Sales : Demand Supply Analysis
Integration of Marketing, sales and services in Agri-value chain are
critical for development of a model which is not only profitable to all
the stakeholders but to mitigate risk due to demand fluctuations
and supply constraints.
According to a publication of Organization for Economic
Cooperation and Development (OECD) the demand for food and
farming will remain strong in medium term given current
macroeconomic indicators.
38
The key recommendations for enhancing Agri-value chain efficiency
by way of integrating marketing and sales techniques include:
1. Develop a matrix and insight for demand and supply gap and
disseminate the information through a common network to
farming community.
2. Continuous market research and surveys along with use of
digital, IOT technology, Blockchain and AI technology needs to
be implemented for better market analysis, need assessment
and creation of knowledge penetration index.
3. Communication is the key for marketing and Branding. A robust
communication strategy needs to be launched to make the
consumers realize the actual cost of production and value
generated by farmers and its sustainability
4. Communication need to focus on green use of Agri
commodities, reduce food wastage and minimize the role of
intermediaries.
5. Explore new variants of food, fisheries and animal
husbandry/dairy products and reach to market that is untapped.
6. Co-operative style marketing strategy needs to be developed so
as to give higher market reach and penetration.
7. Use of social media, digital media and IOT channels need to be
integrated.
39
Strategies and
Recommendations for
Sustainability in the
sector.
40
Some of the key recommendations for Sustainable Agriculture
Development include :
➢ Food trade will increase and contribute to building global food
security, assuming current policies : Because of Geographical,
Climatic and natural divide, few regions are better suited for
producing agricultural goods than others.
This creates an opportunity for trade and
economic activity. India has a natural
advantage being an agrarian county for
ages, it has requisite skill and manpower
to propel the need for global food
security.
➢ Technological developments, and
digitalization in particular, are evolving
rapidly : The food, agriculture and
fisheries sector need to situate itself
within the wider framework of economic,
trading and digital revolution superimposing political divide and
trading restrictions to ensure coherence across policy fields
domestically and avoid policy fragmentation internationally.
➢ Productivity Growth, sustainable resource use, and climate
change require urgent attention : As the global demand for
food, fisheries and dairy product increases, productivity needs
to be augmented with minimal use of resources. Thus the
sustainability is the key challenge. The capacity of the system to
respond to even unexpected increase in demand remains strong
in both developed and developing countries. The use of data
and AIs /Analytics can play a pivotal role to give valuable insights
in near future.
➢ A lot depends of policies : Government have opportunities to
begin to bring back ineffective policies or legacies of the past. In
this way scarce resources will be released that can be devote to
coherent policy packages that can contribute to productivity,
sustainability and resilience.
41
a. Remove existing policy dis-incentives to increase
productivity, sustainability and resilience
b. Re-direct food and agriculture and fisheries support to
ensure the availability of public services that benefit
producers, consumers and society overall
c. Encourage collaboration on knowledge generation and
transfer with public and private actors – nationally,
regionally and internationally
d. Draw on the full range of economic instruments,
including information, education, regulation, payments
and taxes, in pursuit of environmental and climate
change goals.
e. Streamline risk management policies by clearly defining
the limits between normal business risks, risks for which
market solutions can be developed, and catastrophic
risks requiring public engagement
f. Improve understanding of the financial and well-being
situation of farm households to design effective farm-
income support measures.
42
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https://www.azquotes.com/quotes/topics/sustainable-agriculture.html
https://www.wisegeek.com/how-did-agriculture-begin.htm
https://www.un.org/sustainabledevelopment/?s=sustainability+standards
https://corporatefinanceinstitute.com/resources/knowledge/economics/economies-of-
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https://www.pnas.org/content/114/24/6148
https://www.oecd.org/agriculture/understanding-the-global-food-system/what-is-the-
future-of-food-and-farming/
Assessment of Pre-Post harvest losses of important crops in India by Elumalai Kannan
Implementing the 2030 Agenda 2018 Update : World Bank Group
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International Finance Corporation : Performance Standards on Environmental and Social
Sustainability
DIGITAL TECHNOLOGIES IN AGRICULTURE AND RURAL AREAS BRIEFING PAPER by Nikola M.
Trendov, Samuel Varas, and Meng Zeng
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